Legal Question in Real Estate Law in Arizona

Re: foreclosure

Your facts are unclear.

Are there two separate banks involved? Did only Bank A foreclose? Is the bank, or are the banks in California?

You may need an Arizona attorney, so I'l give you a very general answer without knowing more.

Basically, you have a loan (mortgage) with the title to the house as collateral. When you default (i.e. don't pay) the lender will sell your collateral to cover as much, or all, of their losses, plus court costs, interest, and attorney fees.

Re: foreclosure

I either don't understand the previous answer or it is wrong. I see no facts about Bank of America. What I do see is that you have both a first and a sceond, and the second was a purchase money loan, probably as well as was the first.

If the house is in Arizona, Arizona law will apply. Furthermore, unlike some laws that don't vary much from state to state, the laws affecting what are known as "sold out junior loans" and residential lenders' rights to what are called "deficiency judgments" are generally created by statute rather than deriving from common law, and thus may vary quite substantially from state to state.

In California, a purchase-money second is exempt from deficiency judgment under Civil Code section 580b

if it is either (a) seller financing, or (b) third-party financing on a residential property occupied by the borrower.

Arizona law might be similar, but you will for sure have to get your answer from an attorney licensed to practice there.

Re: foreclosure

I apologize for the first sentence of my previous answer suggesting that there was anything to do with Bank of America. On re-reading Mr. Bennett's answer. I see he was talking about a hypothetical "Bank A" and not B of A.